Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

How Much Can You Collect From Social Security With a Salary of $50,000 per Year?

By Katie Brockman - Dec 6, 2020 at 11:46AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

What will your future checks look like?

Approximately 90% of retirees receive Social Security benefits, and these monthly checks make up roughly one-third of seniors' retirement income, according to the Social Security Administration. Because Social Security is a vital source of income for millions of retirees, it's a good idea to figure out how much you can expect to receive each month. Although everyone's benefit amount will differ, here's how much the average retiree earning a salary of $50,000 per year can expect to collect.

Estimating your future benefit amount

You become eligible to start claiming benefits once you turn 62 years old, but you won't receive the full benefit amount you're entitled to each month unless you wait until your full retirement age (FRA) to file. For those who will be turning 62 in 2021, your FRA is 66 years and 10 months.

If you have an FRA of 66 years and 10 months and you're currently earning a salary of $50,000 per year, you would be entitled to receive $1,592 per month at your FRA, according to the Social Security Administration.

Senior couple sitting on a couch looking at documents and a laptop

Image source: Getty Images.

If you chose to claim as early as possible at age 62, your monthly payment would be reduced. In this case, you'd receive around $1,075 per month by claiming at 62.

By waiting a few years to begin claiming, though, you'd receive higher monthly payments. If you waited until age 70 to file, you'd receive $2,081 per month in this scenario.

Keep in mind, too, that your benefit amount could differ depending on your salary and how many years you've worked. The Social Security Administration averages your income over your 35 highest-earning working years, so if you don't work that long, your benefit amount will be lower.

Deciding when to begin claiming

Knowing your benefit amount at your FRA is only one-half of the equation. It's just as important to decide at what age you should file for benefits, because that will have an enormous impact on the amount you actually collect each month.

Claiming early can be a wise move if you have abundant savings and don't necessarily need the extra cash you'd receive by delaying benefits. It can also be a good choice for those who don't expect to spend many years in retirement. If you're battling health issues, for example, claiming early can help you enjoy your money for as many years as possible.

On the other hand, delaying benefits can also be a smart decision, in some cases. If you don't have much saved in your retirement fund and need all the extra income you can get, the higher payments you'll receive by delaying benefits can be immensely helpful. In addition, if you were planning on continuing to work into your late 60s or early 70s anyway, you might as well hold off on claiming benefits to earn those fatter checks.

If you can't decide when to claim, you might opt to file at your FRA. Your FRA is a good middle-ground option between claiming early and delaying. Your benefits won't be reduced, but you also won't need to wait until age 70 to start collecting your checks.

Social Security benefits can go a long way toward making ends meet in retirement, so it's wise to ensure you know what to expect. By determining your benefit amount and then deciding the best age to begin claiming, you can make the most of your monthly checks.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/04/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.